How to Start Investing in Cash Checking & Savings Money Market CD's

Put money aside for a rainy day.

No matter what you do for a living or how much money you make, it is important to set money aside for a rainy day. Many financial experts recommend having an emergency fund with at least three to six months worth of living expenses. This emergency fund can help cushion the blow created by a job loss, health problem or other major expense. Setting the money for your emergency fund aside in a checking account, savings account or bank CD is a good way to grow those funds while keeping them safe.

Things You'll Need

• Bank rate sheet
• Newspaper
• Cash
• Direct deposit form

Instructions

1. Visit several banks and credit unions in your area and ask for a rate sheet. These rate sheets provide a list of the checking, savings, money market and CD accounts the bank offers, along with the current interest rate offered on each financial vehicle.

2. Pick up a copy of your local newspaper and turn to the financial section. Look for ads from local banks. Many banks place newspaper ads to promote special offers on savings accounts, checking accounts, money market funds and certificates of deposit.

3. Check the FDIC website (see Resource section) to make sure the bank is fully FDIC insured. Never put money in any bank unless it has full FDIC coverage on all deposits.

4. Check the required account minimums and fees for each account you are considering. By shopping around, you should be able to find a checking or savings account that does not charge any fees. You can use a savings or checking account as a place to park cash until you have enough to buy a CD or invest in a money market fund.

5. Find the minimum required deposit for the CDs the bank is offering. Also check the minimum deposit for the money market fund offered by the bank. Continue to save your money in a checking or savings account until you have enough for the CD.

6. Put extra money aside by diverting a portion of your paycheck to your checking, savings or money market account. Contact the human resources department of your employer for the form you need to set up direct deposit. Be sure to get the account number and routing number for your bank account--you will need this information to complete the direct deposit form.

References

• Money Central: Emergency Fund
• Lending Tree: Tips for Choosing a Savings Account

Resources

• FDIC Website